We've used Text Link Ads on one of our most popular sites. It worked well, but problems were apparent after a few months. As a result, we removed Text Link Ads from the site a few months ago.

Text Link Ads drawbacks and disadvantages

Server-side scripting is required, and not all hosting environments will support the required functions.

Limited ad inventory - up to ten links per ad unit, although you can request additional ad units on a per-URL basis.

Advertisers lock in their monthly rate forever, no matter how popular your site becomes, for as long as they continue advertising on your site. This is great for the advertiser but not so good for the publisher, who is not adequately compensated for growing site popularity.

Potential for search engine penalties. Google has recently penalized numerous sites running link ads that did not include the 'rel="nofollow"' attribute, resulting in reductions in PageRank. There have been reports of Text Link Ads' hostility to webmasters' adding the nofollow attribute (understandable, as Text Link Ads promote their product as boosting search engine rankings - and, just as understandably, Google and other search companies take a dim view of this kind of attempted manipulation.)

There's no easy way to cancel your account.

We received payments for ads we were not running, after notifying them months in advance that we were going to stop. We refunded the payments, but it seemed odd that we received credit for running ads even though we'd stopped running the ad scripts. Oh, and as of this date, we're still getting "you've earned money" emails every month, even though we stopped running ads many months ago. We modified our account to prevent them paying us since we didn't want to receive any money that would need to be refunded. Accounting problems?